There are unfortunately several areas of modern life and economics where we have to be on the lookout for scams and dishonest people, and the mortgage world is one example. While many mortgage lenders are reputable, legitimate professionals looking to help buyers obtain the funds they need to purchase a home, there are also some who are only looking to make a quick buck, and do so using various dishonest, predatory or outright fraudulent methods.
At Altius Mortgage and our partners at Mortgage Ogden, we’re reputable mortgage lenders with years of experience in the industry and hundreds of satisfied clients to back up our quality, customer-first services. We offer numerous areas of assistance for clients, from mortgage loans for first-time homebuyers to help with refinancing, tips on mortgage rates and numerous other distinct areas. We welcome comparisons of our services to other lenders as you shop around, both because we want the best for all our clients and because we’re confident we’re the ones to provide it – but we’re also here to advise you of some of the signs that another lender you’re considering is not reputable, and in fact may be predatory or fraudulent and should be avoided. This multi-part blog series will dig into all the red flags to keep an eye on here.
Goals of Legitimate Lenders
Firstly, a positive word on what a mortgage lender experience should be like. A legitimate mortgage lender is here to help you make safe, intelligent decisions with your finances as you make one of the largest purchases in your life. They help you take out a loan that you will be able to make payments on comfortably for many years into the future, ensuring your overall finances will remain intact even as you take on this new expense.
Predatory lenders, on the other hand, are just here to make quick cash. They will write loans that are far too costly to borrowers, trapping them in a cycle where they only pay interest and cannot reduce their principal, or other related themes.
What are some of the early signs you might be dealing with such a lender?
Lack of Credit Check
If the lender attempts to move you forward without a check on your credit, this is a huge and immediate red flag. Some loans are designed for people with low or no credit, sure, but the lender still has to check to confirm your status here – and any who doesn’t is trying to pull a fast one.
One of the key practices of predatory or fraudulent mortgage lenders is attempting to confuse you, and a common tactic they use here is rushing. You’ll be rushed to sign paperwork, or told that reading the fine print really isn’t important and you should just trust the lender’s word. This is a frequent sign that there are clauses or parts of the contract the lender does not want you reading.